ASF Submits Request to CFTC re Proposed Commodity Pool Relief

October 5, 2012

On October 5, ASF submitted our request to the Commodity Futures Trading Commission (“CFTC”) seeking interim and permanent relief for securitization trusts and other financial entities from regulation as commodity pools. This request was developed in response to specific feedback received during meetings held last week with the CFTC Chairman Gary Gensler and other CFTC Commissioners. In drafting the letter, we have tried to include a broad array of products, without limiting transactions based on whether they are publicly or privately offered, or cross-border. ASF staff plans to continue daily dialogue with the CFTC in the next seven days prior to October 12th. Special thanks to the hard work of Ellen Marks of Latham and Watkins LLP and the ASF CPO Working Group in producing this letter.

ASF staff and members met last week with CFTC Chairman Gary Gensler, and CFTC Commissioners Mark Wetjen, Jill Sommers, and Bart Chilton. We also met with staff from House Committee on Financial Services (“HFSC”) Chairman Spencer Bachus’s (R-AL) and Ranking Member Barney Frank’s (D-MA) offices, as well as staff from the Federal Deposit Insurance Corporation (“FDIC”). Previously, we met with all of the relevant CFTC staff and CFTC Commissioner Scott O’Malia, Office of the Comptroller of the Currency (“OCC”) staff, and have had dialogue with the Securities and Exchange Commission (“SEC”) staff on the Volcker Rule implications.

CFTC Republican Commissioner Jill Sommers stated on Friday, September 24, 2012 that the CFTC will most likely issue a series of no-action letters and exemptive relief from certain rules before they begin to take effect on October 12, 2012. In addition, CFTC Republican Commissioner Scott O’Malia has expressed concern that the new swaps rules may introduce unnecessary complexity into the market and increase costs for industry participants. Specifically, he stated, “In a mad rush to implement the rules, the commission quite often forgets to make sure that all these rules should work together to achieve the overall objectives of enhancing transparency and reducing systemic risk… It’s not easy to comply with regulations when the goal posts are constantly moving.”